VW says US 'Dieselgate' settlement not to be replicated in Europe

Volkswagen's CEO has rejected calls for the carmaker to compensate customers in Europe over the 'Dieselgate' emissions scandal along the lines of its $15 billion deal in the United States, telling a German newspaper a similar settlement would be inappropriate and unaffordable.Reuters | July 03, 2016, 11:53 IST

BERLIN: Volkswagen's CEO has rejected calls for the carmaker to compensate customers in Europe over the 'Dieselgate' emissions scandal along the lines of its $15 billion deal in the United States, telling a German newspaper a similar settlement would be inappropriate and unaffordable.

Europe's Industry commissioner Elzbieta Bienkowska last week called on Volkswagen to also compensate European owners of its diesel-powered cars, saying it would be unfair for them to be treated differently from US customers just because of a different legal system.

"We have a different situation here (in Europe)," Matthias Mueller was quoted as saying by Welt am Sonntag.

Mueller also said while VW was on a solid financial footing, replicating the US deal in Europe would be tough for VW to cope with financially.

"You don't have to be a mathematician to realise that compensation at arbitrarily high levels would overwhelm Volkswagen," he said.

Mueller said he had spoken to Bienkowska in Brussels this week about his views.

"In the US the (emission) limits are stricter, which makes the fix more complicated. And taking part in the buyback is voluntary (for customers), which is not the case in Germany, for example," he said.

Because the US authorities want as many cars to be bought back as possible, VW also has to offer customers incentives, meaning the situation is not comparable, he added.

Prices of most SUVs were cut between Rs 1.1 lakh and Rs 3 lakh following the implementation of GST, which subsumed over a dozen central and state levies like excise duty, service tax, and VAT from July 1.